WHAT  PUBLIC  OFFICIALS  SAY

 ABOUT ILLEGAL SHORT-TERM RENTALS

  

 The legality and intent of the State and City Governments is clear

 

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The Hawaii State Senate Says:

 

On April 8, 2005, the Hawaii State Senate Committees on Intergovernmental Affairs and Tourism both passed Senate Resolution 21, Senate Draft 1.  It currently awaits a formality hearing in the Senate Ways and Means Committee:

 

TAXATION TO ENFORCE THE COLLECTION OF THE TRANSIENT ACCOMMODATIONS TAX ON UNREGISTERED VACATION RENTALS, AND REQUESTING THE COUNTIES TO ENFORCE THE ZONING LAWS AGAINST ILLEGAL OPERATIONS OF VACATION RENTALS.

WHEREAS, chapter 237D, Hawaii Revised Statutes (HRS), imposes the transient accommodations tax (TAT), commonly known as the hotel room tax, on such transient accommodations as hotels, motels, and other places in which lodgings are regularly furnished to transients for consideration; and

WHEREAS, all transient accommodations are required under section 237D-4, HRS, to register with the Department of Taxation and to obtain a TAT license to legally operate; and

WHEREAS, transient accommodations include "bed and breakfast" operations, which are located in private residences in residentially zoned neighborhoods wherein the owner also occupies the same premises; and

WHEREAS, a bed and breakfast operation is a type of "transient residential vacation rental" that is usually located in residentially zoned areas; and

WHEREAS, bed and breakfast operations are typically unregistered and unlicensed, and operate illegally; and

WHEREAS, some operators of bed and breakfasts and of transient residential vacation rentals are in violation of county zoning laws as they lack the required permit, and in violation of the transient accommodations tax laws because they are not registered and licensed; and

WHEREAS, many transient residential vacation rentals and bed and breakfast operations advertise over the internet, so their identities are known or can be known readily to the counties and to the Department of Taxation; and

WHEREAS, pursuant to section 237D-6.5, HRS, the transient accommodations tax revenues are distributed to the counties, convention center enterprise special fund, tourism special fund, state parks special fund, special land and development fund to fund the Hawaii statewide trail and access program, and the transient accommodations tax trust fund; and

WHEREAS, any loss of revenue from the transient accommodations tax has wide-ranging effect on broad categories of programs and county revenues that depend on the TAT; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-third Legislature of the State of Hawaii, Regular Session of 2005, that the Department of Taxation is requested to enforce the collection of the transient accommodations tax on bed and breakfast operations and on transient residential vacation rentals, especially those that advertise over the internet; and

BE IT FURTHER RESOLVED that the counties are requested to enforce their respective zoning laws and regulations on bed and breakfast operations and on transient residential vacation rentals, especially those that advertise over the internet; and

BE IT FURTHER RESOLVED that the Department of Taxation and the counties cooperate for the purpose of enforcement; and

BE IT FURTHER RESOLVED that the Department of Taxation, as well as the City and County of Honolulu, County of Kauai, County of Maui, and County of Hawaii each report to the Legislature on the progress and results of their enforcement efforts, no later than twenty days prior to the convening of the Regular Session of 2006; and

BE IT FURTHER RESOLVED that the report include, but not be limited to, proposals for legislation, if any; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the Director of Taxation, and the respective Mayors and County Councils of the City and County of Honolulu, and the Counties of Kauai, Maui, and Hawaii.

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 The  Neighborhood  Boards  Say:

Oahu is divided into geographical districts identified by their City and County of Honolulu elected Neighborhood Boards. 

--- WAIANAE ---

The areas covered by the Waianae Neighborhood Board include Nanakuli, Waianae,  Makaha, and others.

Adopted by the Waianae Neighborhood Board #24 at its October 4, 2005 Regular Meeting:

 

The Waianae Neighborhood Board #24 recommends that the Honolulu City Council and the Mayor of Honolulu:

1)  Do not change the Honolulu Revised Statutes to legalize, or otherwise allow, more short‑term rentals, Transient Vacation Units, or Bed and Breakfast Homes in O’ahu’s residential neighborhoods.

2)  Take the necessary administrative and legislative actions to better enforce the laws against illegal short-term rentals, Transient Vacation Units, and Bed and Breakfast Homes in O’ahu’s residential neighborhoods.

--- NORTH  SHORE ---

The areas covered by the North Shore Neighborhood Board include Haleiwa, Waialua, Waimea, Pupukea, Sunset, Pipeline, Mokuleia, and others
.

Resolution adopted September, 2005 by the North Shore Neighborhood Board Regarding Honolulu City Council  Resolutions 05-186 and 05-187

 

Whereas, The City Department of Planning and Permitting (DPP) is responsible for the enforcement of the zoning code as it applies to B&Bs and Transient Vacation Units (TVU). 

 

Whereas, the lack of enforcement of the zoning laws has had a negative impact on our community due to the significant increase in the number of illegal B&Bs and Transient Vacation Units (TVU), including those operating without the necessary Non-Conforming Use Permit. In essence, residential zones are being converted to resort zones by the presence of illegal B&Bs and TVUs. Some of these impacts are:

 

1.    The quality of life has diminished for many residents due to loud noise at night, excess traffic, crowded on-street parking, security concerns and the loss of a familiar neighborhood of people they know.

 

2.    Property taxes rapidly increase as residentially zoned homes are sold as vacation rentals.

3.    Long-term rentals for North Shore residents have become scarce as they are converted to Transient Vacation Units, adding to the difficulty of finding affordable housing.

 

Therefore, be it resolved that:

 

A.  The North Shore Neighborhood Board supports City Council Resolution  

      05-186 with the following additions:

 

      1)  A specific provision applying to B&Bs.

2)   A provision stating that upon the receipt of a written complaint signed by a resident, the DPP inspector will notify the owner or operator of the TVU or B&B immediately.  (While this would not cause a Notice of Violation, or any legal action, it would be a response that could lead to immediate relief and would promptly begin the remedial process.) 

 

3)   A provision specifically prohibiting the short term rental of residential homes for very large gatherings such as corporate parties, weddings, movie shoots and the like without a Non Conforming Use Permit.  

 

B.  The North Shore Neighborhood Board recommends that Resolution 05-187, be deferred until the DPP has had the opportunity to implement the provisions in Resolution 05-186 bringing the Transient Vacation Rental and B&B Industry into compliance with the law and thereby restoring respect for zoning laws and the residential character of our neighborhoods.

--- WAIALAE-KAHALA ---

October 20, 2005

Henry Eng
Director of Planning and Permitting
City and County of Honolulu
650 S. King Street
Honolulu, HI 96813

Dear Director Eng,

Re: Resolution 05-187, Repeal of ban on B&B’s

After review and discussion, the Waialae-Kahala Neighborhood Board #3 does not support City Council Resolution 05-187, which seeks to repeal of the ban on B&B’s in residential neighborhoods. In addition, this Board does not support the legalization of more short term rentals (such as for parties or events), Transient Vacation Units, or Bed and Breakfast Homes in O’ahu’s residential neighborhoods.

Concerns include, but are not limited to:

1. The adverse impact on the quality and character of our residential neighborhoods:
   1. Erosion of sense of community, community involvement and loss of long term neighbors,
   2. Erosion of safety and sense of security due to increased transient nature,
   3. Increased density’s adverse impact on noise, traffic, parking, privacy and open/green space,
   4. Adverse impact on neighbor relations and right to quiet enjoyment as the process will create strife by pitting neighbor against neighbor/employee/non-resident owner.
2. Inflated Housing Cost: Affordable housing is adversely impacted as the cost to local residents for owner occupied homes becomes/is inflated due to:
   1. market prices based on lucrative transient revenue potential rather than owner occupant present value and future appreciation,
   2. competition with investors attracted by transient rental income,
   3. waterfront and near waterfront property being priced out of the range of local home buyers.
3. Increased Property Taxes: Property taxes rapidly increase in neighborhoods as residentially zoned homes are sold as vacation rentals.
4. Decreased inventory, increased demand result as transient, short term rentals eliminate housing otherwise available for owner occupied homes and long term rentals.
5. Adverse environmental impact as increased housing demand results in the conversion of more of our land to housing, roads and infrastructure. Transient use encourages larger homes that result in less open and green space, fewer trees, less water shed, decreased view planes, etc.
6. Threatens residential zoning as historical evidence indicates that zoning follows usage, therefore, if B&Bs are licensed, one could reasonably expect TVUs to follow, then corporate retreats, small inns, and eventually resort zoning, which would eventually allow hotels.
7. Regulation and enforcement has shown to be lacking. Unlicensed transient rentals are increasing in most beachfront neighborhoods, such as the North Shore, Kailua, Lanikai, Waianae and Kahala/Diamond Head. Violations of occupancy restrictions, on site resident requirements and so on are not easy to prove and the Department of Planning & Permitting is limited in its inspection force and lacking in an investigation staff. Enforcement is slow at best and citations and fines usually are inadequate as a deterrent.

In conclusion, this Board opposes legislation that will legalize any more short-term vacation rentals in residential neighborhoods; and supports the City Council's efforts to pass legislation that will expedite and strengthen enforcement against any and all unlicensed B&Bs and TVUs.

Re: Resolution 05-186, TVU Advertising

After review and discussion, the Waialae-Kahala Neighborhood Board #3 supports the spirit of Resolution 05-186 as an effort to enforce the zoning code by limiting TVU advertising to licensed establishments, thereby restricting the customer base to unlicensed properties. This Board recommends the City and County;

1. Use its resources to enforce the zoning code
2. Pass legislation that will expedite and strengthen enforcement against any and all unlicensed B&Bs and TVUs
3. Encourage and organize citizens to aid in the enforcement efforts.

Yours truly,
Lester Fukuda
Chairman

Cc: Mayor Mufi Hannemann
City Council members

--- KAILUA  ---

The areas covered by the Kailua Neighborhood Board includes Kailua Town, Enchanted Lake, Lanikai, Aikahi, Coconut Grove, Maunawili, Kuulei, Kalaheo Hillside, Pohakapu, and others.  It includes approximately 40,000 residents.

Kailua is under siege by the illegal operators – to the point that the Kailua Neighborhood Board took decisive action.

RESOLUTION

 

 

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 The City and County of Honolulu Says:

 

The Revised Ordinances of Honolulu, Sec. 21-4.110-2 (a) states:

 

“The purpose of this section is to prohibit bed and breakfast homes, while permitting certain bed and breakfast homes which have been in operation since prior to December 28, 1989 to continue to operate as nonconforming uses subject to obtaining a nonconforming use certificate as provided by this section”

 

To see the details of the laws, go to pages 84 thru 86 of the Revised Ordinances:

 

http://www.co.honolulu.hi.us/refs/roh/21_990.pdf

 

 

21-10 Definitions: "Bed and breakfast home" means a use in which overnight accommodations are provided to guests for compensation, for periods of less than 30 days, in the same detached dwelling as that occupied by an owner, lessee, operator or proprietor of the detached dwelling.

 

21-10 Definitions: "Transient vacation unit" means a dwelling unit or lodging unit which is provided for compensation to transient occupants for less than 30 days, other than a bed and breakfast home. For purposes of this definition, compensation includes, but is not limited to, monetary payment, services or labor of employees.